Q2 2024 Trex Co Inc Earnings Call Transcript
Key Points
- Trex Co Inc (TREX) reported a 6% increase in net sales for Q2 2024, reaching $376 million compared to $357 million in Q2 2023.
- The company achieved a 13% improvement in net income and an 11% growth in EBITDA, resulting in a 180-basis-point improvement in EBITDA margin.
- Trex Co Inc (TREX) saw double-digit sell-through growth in its premium products, indicating strong demand from high-end consumers.
- The company successfully launched new products, including the Trex Transcend Lineage decking and Trex Signature lines, which have been well-received in the market.
- Trex Co Inc (TREX) continues to invest in branding and product development, which is expected to drive future growth and market share gains.
- Sales of entry-level products were below expectations, reflecting softness in the lower-end consumer market.
- The company anticipates a reduction in pro channel inventories due to current economic uncertainty, impacting sales in the second half of 2024.
- Trex Co Inc (TREX) revised its full-year sales guidance downward by approximately $85 million at the midpoint, primarily due to anticipated channel inventory reductions and market softness.
- Gross margin is expected to slightly deteriorate in Q3 2024 compared to Q2 levels, reflecting ongoing pressures in the market.
- The company experienced a decrease in year-to-date operating cash flow, primarily due to an increase in accounts receivable and higher inventory levels.
Good day and welcome to the Trex Company, Inc., second-quarter 2024 earnings conference call. (Operator Instructions) Please note this event is being recorded.
I would now like to turn the conference over to Casey Kotary, Investor Relations Representative. Please go ahead.
Thank you, everyone, for joining us today. With us on the call are Bryan Fairbanks, President and Chief Executive Officer; and Brenda Lovcik, Senior Vice President and Chief Financial Officer. Joining Bryan and Brenda is Amy Fernandez, Senior Vice President, Chief Legal Officer and Secretary, as well as other members of Trex Management. The company issued a press release today after market close containing financial results for the second quarter of 2024. This release is available on the company's website.
This conference call is also being webcast and will be available on the Investor Relations page of the company's website for 30 days. I will now turn the call over to Amy Fernandez. Amy?
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